Countdown to SL backlash

Let’s face it a serious Second Life media backlash is going to happen in ’07. The only questions are – what form will it take and when will it hit.

Place your bets,,,

While at this year’s State of Play: NYC Teh TN Symposium I decided to write a New Year’s Eve piece about a potential media backlash against Second Life. The basis of this is that the media seems to work in a build ‘em knock ‘em down kind of way. Almost irrespective of the actual merits or otherwise of some cultural phenomenon the popular media seem to over hype it, often making claims on its behalf that it would never make or taking claims with the innocence of a new puppy that’s just been given too many artificial colourings. Only to be followed by stories telling us that the bright new thing is not as bright as we all thought, in fact it’s a bit rubbish, but oh, there is another new bright thing to get fixated on (very possibly the young bright thing of ’07 is Raph's new venture (accumulator bets may include this as a specific option (with a bonus for: see Bartle was right all the time it's about building your own world))).

Second Life, it seems to me, has just had too many headlines for it’s own good (and I don’t mean that sarcastically). The other day I went to bed late and put on the BBC World Service the first thing I heard was a program featuring people talking about Second Life, I woke a few hours later to hear The Today Programme on BBC Radio 4 talking about, yes, Second Life.  OK I thought, now it’s getting silly.

Then the Shirky threads started.

Today I got a link to a story linking Virtual Worlds and the possibility of money laundering (yes, I know, it’s not a new angle).

So, I’m wondering when the backlash will be and what form it will take. And by backlash I don’t mean a few people saying SL is a bit rubbish, a lot of people say that already. I mean something like: more than one NYT piece that directly references SL stories saying that either claims are just not true; or that it’s old news and there is a much better mouse-trap; or that there is something horribly negative about it that everyone’s been missing.

My options for the form of the backlash are as follows:

  1. It’s all just sex. sex sex sex I tell you
  2. It's not just sex, it's prostitution
  3. It can be used for hiding / laundering money
  4. Terrorist can use it to communicate / plot attacks using it’s wonderful simulation abilities (though we've talked on TN about how VW's might help the fight against Terrorism)
  5. Age play or Furries or both: when awww kittens turns to ewwww, give us the wholesome wiikitty
  6. OMG children could use it and (see 1) sex, omg omg omg abuse, grooming - shut it all down now
  7. Hold on a moment, we just noticed – it’s not real!
  8. Addiction
  9. Gambling
  10. The numbers are ‘lies’
  11. Better mouse trap
  12. SL is all just brands these days – what’s the point, you have to be a company to have a real presence and all the users are just mindless fodder that escape the real word into a place where they just get bombarded with the same old messages, look Fox News just opened up sim. Virtual O'Reilly bringing his 'culture war to the virtual' that's the last straw, like we needed another one
  13. And the outside bet - no really, it is just as wonderful as everyone says

Anyone want to place a bet on one (1L$ maximum bet) or add some more?

As to timing, hmm, difficult one, I’d say about March ’07.

Lastly, for the avoidance of doubt, this is a commentary on the media, not on Second Life. SL is great, I have my issues with it and Linden - as expressed here, but on the whole it’s a great thing – and you should also try There too! I really don’t think that Linden have caused all this press hysteria, on the whole they have played a good sensible PR game if you ask me, they’ve just got swept up in something, and I hope, really I do, that there is no backlash, that I’m completely wrong and SL goes on to compete strongly with a few other products in the same space. Fingers crossed.


Comments on Countdown to SL backlash:

csven says:

Easy to agree on the month, but I do see an out for LL:

Consequently, as I already see a downturn around March, I’m moving toward bearish now. We’ll see how things go. If that integrated browser arrives, all bets are off.

Posted Dec 31, 2006 5:28:08 PM | link

Intellagirl says:

I'll see your $L1 bet and raise you a beer in virtual Dublin that #13 will be the future of SL. Just as SL has matured, so will the press coverage. I'll bet that the coverage will move away from the sensational, away from Linden itself and the numbers, and toward stories about what people are actually accomplishing in SL.
Happy New Year!!

Intellagirl

Posted Dec 31, 2006 5:35:26 PM | link

Andrew Burton, aka Jarod Godel says:

You know, if the backlash by March is strong enough, then my April 24th, 2006 prediction would have only been off by a year.

Posted Dec 31, 2006 5:44:50 PM | link

Hamlet Au says:

Worth pointing out that even negative press stories seem to help SL, at least in the short term. To wit:

http://nwn.blogs.com/nwn/2006/09/hacking_up_a_st.html

Posted Dec 31, 2006 6:08:06 PM | link

Jerry Paffendorf says:

Countdown to TN backlash!

Posted Dec 31, 2006 6:46:21 PM | link

Michael Chui says:

There is no TN hype. =P

So, has this taken the place of the usual predictions for the coming year?

Posted Dec 31, 2006 7:35:32 PM | link

Tateru Nino says:

So...basically the same sort of press Second Life was getting about 11 or 12 months ago? Only more people hear it now. MSM's a bit of a boom/bust cycle.

[Microsoft/Linux/Google/Second Life/Apple/whatever] we love you! / [Microsoft/Linux/Google/Second Life/Apple/whatever] we hate you!

Posted Dec 31, 2006 7:45:48 PM | link

Prokofy Neva says:

Beat ya.

"Disoriented"
Posted Dec. 30, 2006
http://www.secondlifeherald.com/slh/2006/12/disoriented.html
"Get ready for the big SL backlash"

Posted Dec 31, 2006 7:46:02 PM | link

Cael says:

Ren, i'll stand you a beer in the British Isles (real, not Suckat Life) just for going there.

Happy New Year.

Posted Dec 31, 2006 7:53:13 PM | link

Prokofy Neva says:

I'm going to bet on 13, but I agree that by March 07:

1. There will be a Congressional hearing about ageplay furries and gambling and such coming out of SL.

2. There will be at least one well-advertised suicide or murder related to BDSM/Gor/some cult through SL or related to someone quitting SL and that will make 1) happen if it didn't already.

3. There will be somebody who sobs to the media that they've mortgaged their RL house or sold their pension IRA or something to buy an SL island business and then got screwed either because a) prices rise dramatically again b) they open source or license the client so that land devalues. This person will sue LL.

All of these developments will help bring in ever new subscriptions. Some kid in Indonesia or something will invent a killer app or game or gadget and people will come in droves.

I'm going to stick with my existing 2007 predictions and predict that Ban Ki-Moon and Kim Jong-Il will meet in Second Life.
http://secondthoughts.typepad.com/second_thoughts/2006/12/my_predictions_.html

Posted Dec 31, 2006 7:53:53 PM | link

Clay Shirky says:

I'm betting on #10 (but that's easy for me, since I know what pieces I have in the pipeline.)

Also, #1 and #5.

I'll add four more possibilities:

14. Distribution of in-world activities show that the bulk of activity X is created by a tiny percentage of people. Public, not understanding power law distributions, is shocked.

15. Ponzi scheme: the economic stats are only sustainable in a period of perceived hypergrowth, and skepticism causes a run on the bank/devaluation of L$. (Were John Gresham writing this scenario, he would call it the Randolf Intuition.)

16. Marketers talk back -- don't get any real numbers from Linden, complain publicly.

17. Marketers revolt -- do get real numbers from Linden, recoil at ROI.

I'd also agree with Intellagirl that the press will mature. There will be fewer publishing of bullshit numbers, a couple of exposes of Linden's system gaming with useless numbers, and lots of "If we can't take it for granted that there is a large and fast-growing population, what *is* going on in there?"

If the press does do that, I think the real question for 2007 is "What happens to SL in an LL backlash?" SL is a platform -- it can't weasel around with numbers or do any of the other shady thing LL is doing. If there is a business backlash against LL, what effectwill that have, if any, on the users of SL?

Posted Dec 31, 2006 8:56:14 PM | link

Allen Sligar says:

I'm going to bet on 2 and 6 by Febuary, and hope they can weather the storm and make it to 13, by November if they have foresight.

The only way to do this is shut down the stuff thats WAY over the line in that red light district. Sooner rather than later.

I mean seriously cyboring is one thing but once NOW gets wind of whats going down in there its game on LL vs. Cultural Elite backlash...if you think the violence
in video games issue raised some congressional heckels,
wait until NOW (and/or the christian coalition) starts flogging the exploitation of women (and more) issue with SL screen shots as examples.....

All it takes is one really good investigative journalist to focus on this area and they'll be used as cannon fodder in pre-elction year grand standing. And corporations and large institutions have thier reputations to think about, no amount of innovation, PR or SL resident blogs are going to stop that bleed.

I really hope this is not the case, I like what SL allows for, in user generated content.

Otherwise, I'm betting on young bright things.

Posted Dec 31, 2006 9:06:35 PM | link

Andy Havens says:

First of all, "new mousetrap" isn't a press backlash. It's good news for the industry. So I vote we take #11 off the list. I'd love to see another VW get as much great press as SL, and for better reasons (Go Areae!).

That being said... In the absence of a *specific* SL-linked outrage... something like what Prok is talking about (ie, Real Person Smith stalks Real Person Jones using SL and kills 'em deader n' dirt), I predict that the MSM press "backlash" against SL in Q1 2008 will amount to...

nada.

Same for Q2-Q4. So I guess that's #13.

If I have to stick a metric in it to make the number fetishists happy, I will say that fewer than 20% of the stories we see about SL, or less than 20% of the copy in any given story will reflect poorly on the platform.

Why? 4 reasons:

1. There's not enough money in SL or at Linden to make it a tempting target for real bad-ass scandal fodder. It's a little company. With only a rounding error's worth of users. Whatever negative angle you pick to pick on is going to have to have stank on it that is also going to stick to other, larger, more moneyed players in the space. Any of the list of reasons above can be levied at other platforms that have way, way more swag. And so the story will be aimed at them first. Follow the money.

2. Although we have been soaking in this story for awhile, the MSM has just started the engine. It's still "news" not "olds" for them yet. Again... unless an "OJ" level crime takes place and has "SL" attached to it (and even that would probably be good for its numbers), the virtual world picture hasn't been painted up one side and down the other. Yes, there are still some nasty angles, and yes SL could painted with the same broad brush as porn, video-games, gambling, addiction, etc. But... it's not *just* any of those things, and that means that the SL story, in and of itself, will still remain one of "hi-tech intrigue" with a side of sauciness for at least (I predict) a year or so longer.

3. SL is too much about "us" as opposed to "them." Which is why it makes an intriguing story in the first place. "Look what 'we' can now do in one of these 'game world places.'" If there's sex and prostitution, it's because it's what the users (we) have decided to do with the platform, not what Linden has set up the space for. If there's gambling, same same.

And when the story is about us, it's much, much harder to be really cruel with the press stick, unless there's been a specific crime committed by the publisher. With games, movies, casinos, actual brothels, etc., the press (and we) can point a finger and say, "There's the bad mans with the camera making the dirty movie!" Or, "There's the evil game publisher making the violent game!" Or, "There's the evil pimp and his salacious whore!"

Where does the finger point at SL? It points right back to the world at large; to the users. That's uncomfortable. And so the urge is to look around and say, "Wait. There are also people building libraries and schools and other games and arboretums and scale models of all kinds of kooky but innocent things and, wait... aren't we free to be a bit sexy and goofy and crazy, too?"

#4. If the press kills SL, they don't get to talk about it any more, and, right now, there's no other venture like it that they can talk about.

BONUS NIT-PICKING:

The money-laundering angle won't get cranked by any serious outlet at this point. We have less than 60 players pulling more than US$5,000 out of the space every month. No offense to SL, but more money than that gets laundered every day in small hawalas in Central Ohio.

The truly bizarre sex stuff (Goreans, animal/furry fetishism, rape fantasy, age play, etc.) won't sell because you simply can't talk about that in the MSM. It's too too. And, again... in the case of SL, it's too small, too low-bucks and too much "us."

The marketers won't "talk back" or "revolt" because to do so would mean one of two things: they were either ignorant or fooled. Which would I admit to? Neither. This also assumes that marketers somehow were expecting a "Web based" ROI a la unique visitors or page hits or something. And the price of setting up shop in SL basically fades into the noise for even a medium-sized company when compared to the rest of the marketing budget. "I want my US$5,000 back," coming from American Express?

The "power law distribution thing... This is akin to the 90-9-1 deal, right? 90% of the people just show up and watch, 9% comment or provide low-level interaction, and 1% actually do all the work? I have no idea if it's true in the case of SL or any other particular social or creative space. If it's true in SL, I agree that the public will not understand... but I guarantee that they also will not give a fat rat's ass. Why? Same reason that the "90" is a "90" in the first bloody place.

So... Consider me the "Very Slightly Pre-2007 SL Backlash Backlash."

I been wrong before. And I been wrong in this space before (And I've thanked Thomas for the privilege ;-)), but I just don't see that much to "backlash" against.

Posted Dec 31, 2006 11:01:28 PM | link

JuJutsu says:

"I'm going to stick with my existing 2007 predictions and predict that Ban Ki-Moon and Kim Jong-Il will meet in Second Life.
http://secondthoughts.typepad.com/second_thoughts/2006/12/my_predictions_.html"

I still have my sign-up Linden Dollars; I'll wager all of them against Prokofy's prediction ;)

Posted Jan 1, 2007 1:32:58 AM | link

Jessica Mulligan says:

Why would the main-stream press mature on this story? They haven't done so for the last twenty years; why should it happen now?

Remember, much of the main-stream press is inexperienced with the industry at ths level and many are just plain lazy; not only do they rarely know what questions to ask, they are looking for easy stories that write themselves and can be turned in by deadline. "One million residents!" is easy, "$1 million in virtual worth!" is easy; "Excessive churn" or "Very hard to make money here" takes work.

What we are more likely to see happen is those folks picking up posts by people who do know what to look for, such as Clay Shirky, et al. In other words, less 'maturing' and more easy stories that write themselves. For an example, how many times over how many years did we see Julian's "A Rape in Cyberspace" rewritten and printed under new bylines? You can expect to that happen more often.

What that means for the industry is, I believe, that the themes that are meaningful will develop over time, now that the main-stream has bunches of 'Story Helpers' on the Internet (rather like Hamburger Helper; just add meat, even if it is someone else's).

As for SL in specific: I agree with Prokofy, there will no doubt be one or more real-life financial sob stories and/or lawsuits against LL. It seems to be the next stage of the formula.

Overall: As long as they continue to bring in investor funding, LL and SL will be around, and as long as their PR machine keeps cranking, there will always be press about it. And in the long run, it will be good for the industry. Whether SL actually makes it as a true, viable, ubiquitous or widespread of use money-making machine is irrelevent; some non-game VW will achieve that status, some day.

Posted Jan 1, 2007 3:47:48 AM | link

Mike Sellers says:

Jessica: Overall: As long as they continue to bring in investor funding, LL and SL will be around, and as long as their PR machine keeps cranking, there will always be press about it. And in the long run, it will be good for the industry. Whether SL actually makes it as a true, viable, ubiquitous or widespread of use money-making machine is irrelevent; some non-game VW will achieve that status, some day.

I mostly agree. My concern is the potential for backlash (is all PR good PR?). I'm not going to speculate on if or when this might happen with SL; I hope it doesn't -- to them or WoW or Runescape or anyone else.

But I think as virtual worlds emerge from the fringes into the territory occupied by the eyes focused on NYT and CNN, some of our old fast-and-loose ways of pumping products can easily come back to haunt us. Currently SL is the poster child for tempting fate with PR that is just begging for someone (like Clay... or Jack Thompson) to dig into to find issues that they feel need airing.

But I hope we, as an industry, can understand the raised stakes and interact with customers and the media appropriately, and dodge any backlash bullet that might be in the offing.

Posted Jan 1, 2007 1:19:13 PM | link

randolfe_ says:

15. Ponzi scheme: the economic stats are only sustainable in a period of perceived hypergrowth, and skepticism causes a run on the bank/devaluation of L$. (Were John Gresham writing this scenario, he would call it the Randolf Intuition.)

When this comes to pass, I'll proudly invert my tin-foil hat to the not-so-shiny side facing outwards.

For the record, there are other SL pursuits besides virtual denizens* chasing the dream of becoming virtual land flipper moguls.

There are also gamblers, prostitutes, johns, voyeurs, cyberers, wannabe cyberers, and a few corporate marketing people with too much budgetary freedom -- at least until their company is LBO'd by a mega private equity fund in coming months.

--
* A denizen is precisely determined by calculating the generalized autoregressive conditional heteroscedascticity of the standard deviation of "residents", passed through a Bayesian filter, and finally normalized through a time-delay, reentrant neural net (optimized with genetic algorithm parameter narrowing).

Posted Jan 1, 2007 10:21:51 PM | link

Kelly Rued says:

There's nothing in the list of predictions there that is improbable, and most people who've given SL more than a passing thought have already realized the inordinate numbers of possible PR debacles waiting to happen. I even think these will manifest as some serious legal problems, especially where illegal virtual casinos are concerned (and tax fraud, like all the virtual business owners who don't pay employment taxes or minimum wage even).

It would really be like shooting dead fish in a barrel for any journalist to come up with a backlash story... so maybe that explains all the coverage as of late. One can't really make a career outing the seedy underworld of SL if the general public doesn't know what the heck SL is. The conservative right can't have a cow until they "get" what is going on, and what all the fuss is about. So yeah, I too feel like SL is getting set up on a pedestal with overhyped media coverage that will backfire once people realize that many of the design tenets that give SL its utopian veneer *also* allow for some seriously illegal and arguably immoral real-world activities.

I'd like to place my bet for the biggest prim turd to hit the real world fan on this: That through some legal action, somewhere, SL players finally realize that what they do in SL does NOT stay in SL. SL is not a magical world in the nation of Linden Lab... it's a service in the real world that falls under all the local/regional laws of any other online service. The SL economy broke the magic circle big time, and most of its players still don't get what consequences that may have. People say it's not *just* a game, but players might soon wish it was *just* a game.

Another, slightly off-the-point bet is that they eventually have to shard the world. As a long-time SL player I have noticed the intense upswing in technical difficulties they have had with the post-summer population growth and I have also noted their continuing policy of implementing cool new stuff before the cool old stuff is actually fixed. If their popularity continues and gets anywhere near MySpace mass-market volume, having one grid to host the whole player base seems rather improbable. Maybe the tech foundation is more scalable than it seems to outsiders but since this is a betting game... I'd put at least L$10k, a rare Starax sculpture, AND an all expenses paid session with a furry twelve year old dominatrix on the eventual collapse or near-collapse of the one main grid.

A good side bet will be that the minute there is anything even remotely comparable to SL online for free (Multiverse, or otherwise), the SL population will leave. Many people are pissed at the island price hikes and the cultural changes brought on by free, unverified accounts (including me) and LL might not realize just how much of their player base is held tight by a monopoly of sorts-- not by genuine user satisfaction. Once there is a viable alternative, it will be VERY interesting to see how SL tries to attract and retain players. Once the novelty has worn off, what will they have for unique selling points? It'll certainly be fun to see what happens. :)


Posted Jan 1, 2007 10:54:09 PM | link

Stan Trevena says:

I will go with #13. And I will flip the prediction around and say that by next Fall (read: October) you are going to see a lot more press, starting this Spring (May) in education centric publications, about projects in the K-20 education space. This is where the positive growth will be, at least the growth that will counter some of the XXX and adult stuff on the main grid that have attracted the Wired's of the world in the MSM. The education maket is vast and untapped. Nobody has gone after this market yet with virtual spaces, and there's an upswell in people exploring this virtual space with SL right now. Who needs a Microsoft when you can roll your own in SL.

I will also make a prediction that LL needs to license the server software so that people can open their own grids (mini-grids on home systems, up to large grids for corporations and education). These will all be linked together through a DNS-like system that will link them all together as a world wide web of grids (IBM and eCommerce v2.0?).

This model is going to be the only way that LL will be able to keep up with growth. If they try to keep it all internal and proprietary the momentum will stall, the system performance will lag, and people will move on to other platforms. We would all be using Mac's right now if Apple had opened the standard back in 1984. Let's hope that LL's ego is not as large as Apple's was back then that they didn't need anyone else to be successful.

This model works because nobody in SL walks anywhere, not since the early days back in 2003. In almost all cases you teleport between locations. So what's the difference between plugging a URL into your browser and using an SLURL to get to your destination?

My prediction for 2007 is servers, servers, servers, grids, grids, grids, distributed, distributed, distributed. It is only with these individual grids that you will start seeing specialty portals being formed for all these dispersed grids. And then, Google will step in with a SL search engine to help you find ANYTHING ANYWHERE in the SL universe. This will also isolate LL from any horror stories about sex, fetishes and crimes. They can respond with their user agreement and disconnect the offending grid from the virtual world.

Far too many people are trying to equate SL and other upcoming virtual world platforms with games like WOW. While it's true that there are games going on inside these virtual worlds, they are not a game in and of themselves. They are a platform for social based activities. The difference between MMO's (like WOW) and SL are as clear as between a blank writing journal and a published novel.

My other prediction is that if LL does not figure out how to distribute their platform by licensing, and allowing individuals, businesses and educational institutions to host their own, they will collapse under the demands being placed on them, and they will fail due to not being able to effectively scale to meet this demand. This could easily happen inside of a year if they can't keep up with the current increasing population (and that brings us back to the resident numbers debate).

Want an even whackier prediction? Mini-grids that are similar to IM clients on home systems. You can have a virtual acre of land free of charge that is connected to "the grid" when your PC is online (want more, pony up a monthly fee). Load up your space with devices that stream your iTunes library and videos, has a bunch of multimedia gadgets to wow your friends, and just hang out and travel around with your buddies. Can you say "bye bye MySpace, hello VSpace?". This would really drive the virtual gadget and fashion markets for SL for the 13 - 25 demographic.

It's going to be an interesting year. I hope they are nimble enough to adapt this to scale to much larger populations. If you really want to step way out there on a limb, how about a Google/SL partnership? That might bring the distributed knowledge necessary to pull this off.

New Year's means we all get to make wild predictions and play futurist. These are my predictions for SL in the next two years.

Posted Jan 1, 2007 11:02:24 PM | link

Andy Havens says:

Oh. Sorry. Have to add one more thing to my list of reasons why the press won't be as fast to hop on a backlash bandwagon:

#5: Doing a negative story is much trickier and more complicated than a puff piece or a positive story. If you are going to make accusations of illegality... add more layers of complicated.

Yeah, it's bad when the MSM gets the SL numbers wrong on the up-side. And if they spray happy-juice about SL and yap about the bright future of VWs and it gets more shine than it should because the number is wrong in the good direction... who's gonna complain?

On the other hand... a publication runs a much greater risk when it runs a negative story. In a couple ways. First, if they say something that's not true and it's harmful to the company they're slamming; very bad mojo. Second, if they want to ever come back to that company and get friendly-time, fugeddaboudit. Yeah, everybody jumped on Enron after the collapse. But go back and check out how many papers did "Enron Bad" stories before the news broke widely. Until there's an actual "story" it's hard to have a backlash that's anything other than, "This is last year's news."

Which won't happen until there's "this year's news" to replace it with.

Posted Jan 1, 2007 11:35:50 PM | link

IAmEric says:

Hi Stan,

Great comment. I'm pretty much with you on everything there.

As far as partnerships, a Google/SL partnership makes less sense to me than Google outright buying SL. If I were to guess at a partnership, I'd go with IBM/SL and/or Sun/SL.

As far as a backlash is concerned, I think it is irrelevant. SL will be in the news in 2007 even moreso than 2006. That will include both good and bad press. The bad press will draw people to SL even more than the good press, so I don't see anything short of a cease and desist order from Homeland Security or something slowing down its growth.

The open server issue is a no brainer and I'm pretty sure it will happen in 2007. Probably with the help of IBM and/or Sun.

Happy New Year!
Eric

Posted Jan 2, 2007 2:12:10 AM | link

lewy says:

I'm going to predict that there is no backlash in the mainstream press. SL will only be a story if its subscription numbers climb radically. Until reporter X can actually look around at his or her circle of friends and see a sizable proportion playing SL the game's not likely to garner any more significant press coverage. That, incidentally, is my guess as to why even WoW didn't garner huge amounts of attention.

SL's already gotten its 15 minutes of fame, so I'm going to predict a period of benign indifference from the press. Unless something new and unusual happens (such as actual subscriber numbers, a Britney Spears concert, etc.) it's not likely to recover the same level of press coverage.

Posted Jan 2, 2007 4:22:47 AM | link

Mithra says:

Speaking about Second Life... and sorry if this is off-topic, but is anyone keeping track of this whole taxable asset mess? Julian is a great journalist, but if he ( and the rest of you ) struck the spark that clues the IRS into pursuing legislation that cripples virtual economies, then you've all done way more damage than any exploiter might have accomplished.

Posted Jan 2, 2007 8:36:34 AM | link

Clay Shirky says:

Yeah, it's bad when the MSM gets the SL numbers wrong on the up-side. And if they spray happy-juice about SL and yap about the bright future of VWs and it gets more shine than it should because the number is wrong in the good direction... who's gonna complain?

Me.

Next Valleywag piece is up.

Posted Jan 2, 2007 10:11:34 AM | link

k says:

These Penny Dreadfuls/Paperbacks/Radio Programmes/Jazz 78s/Cinemas/Modern Beat Combos/Televisions/Computer Games/Internets/Virtual Worlds will have a detrimental affect on everything our great empire holds dear! They will corrupt our servants, scare the horses, inflame the passions and cause the lower classes to become insolent, possibly even leading to spitting in the street! We must act immediately!

Posted Jan 2, 2007 12:01:14 PM | link

Mithra says:

Perhaps TN should require a login to post. I'd like to strangle some of these automated spammers.

Posted Jan 2, 2007 4:06:11 PM | link

Andy Havens says:

@Clay: Two points.

I teed that one up nice and warm for ya, didn't I?

Posted Jan 2, 2007 9:32:51 PM | link

csven says:

@Clay - I'm confused by this line:

"...since Linden never tells anyone how many regular users Second Life has."

Can you define "regular" for me? Last I checked, the "Stats" post was stalling without any real progress on that "apples-to-apples" comparison (which, when I read that comment on your entry by "strevena", sounds like something you would want to have).

Posted Jan 2, 2007 9:34:26 PM | link

Clay Shirky says:

@Andy, thanks for that setup. I owe you a beer.

But seriously, your analysis of the situation is closest to my own -- the press will never go back over Linden numbers if doing so means digging into it themselves. Too much risk for too little payoff.

So my goal is to change the _kind_ of story this is. Instead of a "This is the future, signed everyone" story, where any naysaying from the press creates the risk you highlight, I want to change this into a "He said/she said" story. The press is happy to put skeptical coverage into a story if they are not the ones being skeptical.

By picking a single, narrow issue and harping on it repetitively, I've started to create a situation where writing about the Linden numbers includes an opportunity for skepticism. I've done a couple of interviews about it, and people like David Kirkpatrick telling me off isn't hurting visibility any, but the proof is in the pudding. If the demographic reporting 3 months from now is as credulous and uninformative as it is today, I will have failed.

Posted Jan 2, 2007 9:52:57 PM | link

Andy Havens says:

@Clay: Come with Thomas to see the concrete corn (or "Cornhenge" as we call it in Dublin, Ohio) and I'll take you up on that.

I think an opportunity for skepticism is clearly warranted; in this as well as almost any other situation. I'm not a huge Ronald Reagan fan, but I do enjoy one of his favorite sayings: "Trust but verify."

Per your third article, I, too have found some of the blog criticism of your criticism at least as funky/goofy as some of the original number shindigs. I've never argued with the two basic premises of your position:

1. That LL calling account sign-ups "Residents" is misleading, and that it inflates the actual number of unique users of the service.

2. That many press folks didn't get #1.

My concerns are:

A) Your concern for #1 may be overstated. I'm not sure when it happened in history, but on Linden's economic page:

http://secondlife.com/whatis/economy_stats.php

There is a footnote that defines: "A Resident is a uniquely named avatar with the right to log into Second Life, trade currency and visit the Community pages."

Now, that may be vague and squirrely as far as the press goes, but it is a definition, and it doesn't say anything about users; just avatars. Soylent Green may be people, but residents is avatars. You've said that you believe "residents" is a camouflage term. If that definition has been posted somewhere for awhile, and the press didn't like it or didn't get it... again... that's bad, but not Linden's fault as much as that of the press.

Also, in the TOS for SL, it says:

"2.4 Account registrations are limited per unique person. Transfers of accounts are generally not permitted... Linden Lab may require you to submit an indication of unique identity in the account registration process; e.g. credit card or other payment information, or SMS message code or other information requested by Linden Lab... You may register multiple accounts per identification method only at Linden Lab's sole discretion. A single account may be used by a single legal entity at Linden Lab's sole discretion and subject to Linden Lab's requirements. Additional accounts beyond the first account per unique user may be subject to fees upon account creation."

Now... that don't mean at all that it doesn't happen. But it is a policy. Whereas many MMOs don't give a hairy humbug if you have 2, 5 or 10 accounts per individual... as long as you pay your monthly. This provision makes it clear that the goal is to have one avatar (account), or at least only one free one, per real person.

Again... this all goes back to context. Here at TN and on other gamer blogs, the statement, "You know, SL's 'residents' number has nothing to do with the number of current people playing the game," holds about as much shock and awe as, "William Shatner wears a rug." I know you know that; you've said as much. But by the same token, we take that knowledge into the mix with all the other SL stuff and roll around in it. Getting those numbers un-screwed is part-and-parcel of how SL, and all the other services in the space, fit into the industry.

Which leads me to concern...

B) The level at which you are pitching this very specific issue as a "Bad Thing That Must Be Cured."

There is no real danger that WoW could ever be harmed by a story that came out and said that some decent number of its players are gold farmers or multiple alts. There's no danger that MySpace is going to fold when we find out (like we don't already know) that people create multiple pages, let some die, keep up others, etc. etc.

The nut at the center of your argument -- that how we measure the use of social software platforms is incredibly important -- is a hugely valid observation. It's one I've been making for awhile, too, as have others here and in various related spaces. But to use as an object lesson LL's failure to meet (on one number) an as-of-yet un-defined standard -- that, to me, is a somewhat unfair level of (to use your word) harping.

Second Life has been around for more than three years now. And they've been saying "Residents" that whole time. And they've been getting really good press that whole time. And everyone in the industry has known that it didn't mean what some in the MSM thought it did. Same as my wife, the primate anthropology major, knows that every 3-out-of-5 times they call something a "monkey" on TV, it's actually an ape. You don't call Dan Rather and say, "It's a chimp, g**damnit! A chimp is a Greater Ape! Not a monkey, you bozo!" Why? Because it's the press. If they get the parts of the story that matter (the chimps are dying from poachers and need your help), then you don't sweat the details so much.

I think I want what you want, Clay: better numbers and better reporting. But I'd like the discussion to be about those issues across the entire industry, and I'd like it to involve more context than just counting heads.

If your call-out on this issue brings those things to pass, that'd be great. I'll owe you back that beer and a bucket of wings to go with (or beef on weck, if you ever spent time upstate). But, if instead, it just lands us with a bunch of MSM boomerang SL bashing that's as shallow and uninformed as the original reporting we're taking issue with... well, that's concern "C."

Posted Jan 2, 2007 11:26:58 PM | link

eric says:

I think it will happen when all the companys signing up for SL and buying 1600 dollar islands realize they have made no money on their investment,and saved no time in meetings since nobody can log on since griefers attacked again. Oh and look all of the minutes form last weeks meeting are gone since the asset servers blew up again. Companies bail leaveing the lindens witha bunch of over priced islands they try to dump them on a flooded market ..the value of the linden drop and 80% of the "2000000" people turn up to be alts for all the griefers mentioned above. THE END

Posted Jan 3, 2007 12:10:52 AM | link

lewy says:

Andy Havens wrote:

"Second Life has been around for more than three years now. And they've been saying "Residents" that whole time. And they've been getting really good press that whole time. And everyone in the industry has known that it didn't mean what some in the MSM thought it did. Same as my wife, the primate anthropology major, knows that every 3-out-of-5 times they call something a "monkey" on TV, it's actually an ape. You don't call Dan Rather and say, "It's a chimp, g**damnit! A chimp is a Greater Ape! Not a monkey, you bozo!" Why? Because it's the press. If they get the parts of the story that matter (the chimps are dying from poachers and need your help), then you don't sweat the details so much."

Except that the detail we're talking about here is much more important to the story than somebody calling an alligator a crocodile. The while point of the latest batch of media coverage was that SL has millions of users--that's just completely wrong and it's wrong by a couple of order of magnitude.

In other words, it's not an issue of calling chimps monkeys. In fact, the media has totally screwed the pooch and the real story is not poachers killing chimps, it's about exploding chimp populations that threaten to destroy the rain forest like a horde of locusts.

Posted Jan 3, 2007 12:17:29 AM | link

Matt Mihaly says:

Lewy wrote:

it's about exploding chimp populations that threaten to destroy the rain forest like a horde of locusts.

Hmm, link? I've got a vacation planned to the rain forest and now I'm seriously considering cancelling. Thanks for the tip though. My jungle clothes are dry-clean-only which makes exploding chimps an even bigger fashion hazard.

--matt

Posted Jan 3, 2007 12:25:47 AM | link

Amarilla says:

A press-novel is just that, a novel. Like a movie . It's about a writter telling fairy tales about --let say-- a MMORPG or VW. When i need informations , i come to TN or any other alike , not to the press and/or forums .
But when a games-company makes a PR , that's another story ; it's the company making an official statement; it's advertising . Example : take a look at Market Wire, they posted a PR stating : " Jon " NEVERDIE " Jacobs is the owner of Club Neverdie " . The source of that PR is very clear stated , is the game-company. So, now we have solved the problem of ownership over virtual stuff. I'm just a gamer , but you here at TN are scholars, academics , games-developers , geeks and all. IANAL either. But some of you here at TN , are. I'm telling you this : me, as a gamer, i need Clay Shirky to inform me. You, as devs,and you, as the press , you need me. Without me, there is no games and no press anymore. I'm sure the press already knows this. But the devs needs Clay too, to remaind them this basic truth , from times to times.

Posted Jan 3, 2007 4:47:55 AM | link

k says:

@mithra

Err... sorry! Was that aimed at me? I was trying to make the (lighthearted) point that you always get slightly hysterical, semi-informed backlash in the 'mainstream' media about any new media format, and that the reactions have been broadly the same since the mid-Victorian period - that it corrupts the young, the stupid and the poor, and represents a threat to the stability of society, mainly. But I should probably have appended a sentence to the end of my comment being a bit more explicit about that.

I'm genuinely tickled at being mistaken for a spam bot, though.

Posted Jan 3, 2007 6:53:37 AM | link

csven says:

I'm getting the feeling this may be "C", because we seem to be going back to where we left off with the third "SL Numbers Aren't Real" thread and willing to continue bashing without any real interest in learning anything.

I saw this on We-Make-Money-Not-Art ( Link ), one of the more influential blogs out there:

The main strenght of WOW is that today the game counts 8 million players (about half of them are Chinese). Other MMORPGs are still counting in hundreds of thousands of players. Counting millions of players means a lot: it means...

Contrast that with this comment (the one to which I referred above) by "strevena" ( Link ):
What about WOW? After reading the 100+ comments to your last post on this, I would not be considered a resident/subscriber/surnit on any of the services I maintain accounts with. I've not played WOW since last May (outside of an occasional login to get updated clients). I do have two copies of Burning Crusades preordered (one limited edition) so that my boys and I can take our 30+ avatars into the new lands when they open up in a few weeks. How many "residents" does that count for at Blizzard?

Does this person have 29+ sons? I'm impressed.

Posted Jan 3, 2007 8:01:04 AM | link

Ace Albion says:

I guess if its like EQ etc you get a load of character slots to fill with avatars for each server. The WoW 6-7 million is actually people/accounts though? Little parcels of $15 dropping from the sky each month. One person, two/three accounts, thirty avatars.

As a side note the switch to names at the start of comments is handy dandy.

Posted Jan 3, 2007 10:11:45 AM | link

Clay Shirky says:

@Andy, this is I think the key point in your note: you distrust [t]he level at which you are pitching this very specific issue as a "Bad Thing That Must Be Cured."

I do not, as a general rule, call BS when I see inflated claims being made on behalf of the revolutionary possibilities of technology X. Not enough hours in the day, not enough keys on my keyboard, and bo-ring.

I do call BS on one specific occasion, however: when I believe programmer time is being wasted.

I've done a lot of things in this business -- written books and run tech departments and consulted and taught -- but the one goal common to every job I've ever had is to make it easier for people actually building things to get their work done. I say this as an indifferently talented coder -- when people ask me what I do, I sometimes sum it up by saying "I drive an ammo truck for developers."

So when you say "And everyone in the industry has known that it didn't mean what some in the MSM thought it did" and make the monkey/ape distinction, I have to say I agreed with that view up until about 6 months ago. The fate of SL was no different to me than the fate of WiMax -- I was skeptical, but perfectly willing to let the market grind through the issue without any participation from me.

Six months ago, though, something changed. SL became "The Future of the Internet." Through some combination of Linden PR and press gullibility, the projected future value of Second Life (and therefore virtual worlds and therefore the metaverse) went hyperbolic.

And it wasn't presented as a future -- streaming video is good for some things and IM for other things and Second Life good for still others. It was presented as the future. "You'll log in to Second Life, and your avatar will watch videos and IM other avatars!" A lot of time and effort, including especially developer time and effort, is being deployed to embrace Second Life/The Metaverse, because of what some CEO was reading in Forbes.

Since the future of the internet matters to me more than any other thing in my professional life, and since my particular and peculiar bailiwick is social software, this fall I changed my stance from passive skepticism to active investigation. I view the world through a social lens, so the census was the first order of business. "How many regular users does SL have?" I asked myself.

I will not be revealing any state secrets to say I didn't like what I found, or rather didn't find.

You and I both understand that the SL numbers are weak (on the same page they define Residents, btw, they also take care to note that their reported earnings stats are rolled up across all avatars, so they calculate person numbers daily, but report them only when it makes them look good). What I think you don't understand, breathing the rarified air of Terranovian discourse, is that there are people committing resources to SL who are adopting SL not because of technicla judgment but because of social proof. No one ever told iVillage they needed to stage Girls Night Out in WoW, no one ever told Procter and Gamble that the SL press releases read like Black Sun/Blaxxun press releases with the dates changed.

When Betsy Corcoran at Forbes tells her readers that SL has over a million customers, the readers are not thinking "Well, I know Linden numbers don't actually refer to customers, so I'll apply a hype discount of X." They are thinking "One million customers! That's serious bank! How do I get me some of that action!"

So, I've done my little part through my harping (a fair word, and one I set out to embody, since I feared anything less wouldn't register) to puncture the hype. But when you say "There is no real danger that WoW could ever be harmed by a story that came out and said that some decent number of its players are gold farmers or multiple alts", I think you have a different model of that puncture. You may imagine a birthday balloon, where a puncture is a risk to the integrity of the whole.

Linden is not like that -- they have tens of millions of dollars in VC backing, an all-star board, dozens of employees, and tens of thousands of users. To put things in perspective, I am a lone actor, who isn't even paid to write this stuff. The hot air is rushing into the balloon at such a rate that no puncture I could make would deflate it. The best I can hope for is to slow the rate of ascent.

It cannot be the case that SL is both the future of the internet and not worth reporting right, but since no one else seems to be working on fixing that problem, I decided a few weeks ago that I'd have to try to do it myself. As I said earlier, my goal is less credulity from the press in three months time. Even that outcome, sadly, is 4 to 1 against.

Posted Jan 3, 2007 10:53:54 AM | link

Mike Sellers says:

The WoW 6-7 million is actually people/accounts though?

We've discussed this before, several times over the past year and more.

Blizzard has been pretty straightforward on their definition of "users" from the start, and includes this definition in every press release (but note that they have changed their definition from including only unique game room users from the past 7 days to the past 30 days):

World of Warcraft's Customer Definition
World of Warcraft customers include individuals who have paid a subscription fee or purchased a prepaid card to play World of Warcraft, as well as those who have purchased the installation box bundled with one free month access. Internet Game Room players that have accessed the game over the last thirty days are also counted as customers. The above definition excludes all players under free promotional subscriptions, expired or cancelled subscriptions, and expired pre-paid cards.
This clarity and transparency is why, as Prokofy has asked a couple of times, there hasn't been the same level of skepticism about WoW's numbers as SL's numbers. When Blizzard says they have 7M users, you know what that means in terms of both actual popularity and actual revenue (with some slosh accounting for international distribution deals). When they say they have 2M users, there's no asterisk saying "but only 1.8% of those pay us any money."

Clay said: A lot of time and effort, including especially developer time and effort, is being deployed to embrace Second Life/The Metaverse, because of what some CEO was reading in Forbes.

Just yesterday I was contacted by a MSM journalist (who does not read TN, your blog, or other similar places) who had become interested in SL in a B2B context. After a bit of discussion, the justification for this interest was along the lines of "well, a guy in finance thought it looked pretty good from the Business Week article he read." Fortunately this journalist thought he ought to do a bit more digging to find out about what SL really was and not rely on someone else's views, but what you say about "SL is the future of the Internet!" is basically the message he'd received.

Posted Jan 3, 2007 11:06:31 AM | link

Jesper Juul says:

I thought there already was a SL backlash happening, based on 10), the numbers?

It makes me feel a bit old - confusing the number of registered accounts with the number of active/paying users is sooo 1997 dot com.

Posted Jan 3, 2007 11:47:01 AM | link

Bart Stewart says:

First, I guess I'm in the camp with Jessica that sees no signs of maturation in the world of journalism. In fact, I'd say just the opposite is happening.

Journalism is no longer about simply reporting the facts. It's now about advocacy. Just reporting what happened isn't good enough; to have any relevance, journalists are now required to actually influence events.

This is done by crafting stories whose function is to generate the desired perception in the public. Instead of things happening and then being reported on, today's journalists strive to create the news they want to write about.

The coverage of the recent U.S. Congressional races was a low point in this kind of "push" journalism, but it's been devolving for years now. The journalists at the Boston Globe and New York Times who fabricated stories, the "Dateline: NBC" truck exploders -- these differ from the old yellow journalism press in that they aren't making things up for any reason as crass as financial profit -- their goal is to push a personal agenda, to go beyond merely informing the public to actually guiding the public into embracing the "right" conclusion.

I see no reason to think this pattern of behavior will change any time soon. And I see no reason why it won't be applied to Second Life, or to virtual worlds in general. A backlash in the form of a spate of "Warning! Warning! Danger, Will Robinson!" stories is inevitable.

As to that being more difficult than reporting good news, I'm not sure that's so. You simply resort to the use of unnamed sources: "Some generals have said that additional troops will not help to reduce the levels of violence in Iraq" -- that sort of thing. "Experts say your death from rising sea levels due to global warming is imminent... unless the right people are elected, nudge-nudge, wink-wink."

"Experts say that children are at the most risk from these fantasy worlds" can't be far behind.

Additionally, I note my personal observation that most journalists seem to actively hate technology, and extend something of that sentiment to anyone who appears comfortable with technology. Old-school journalists in particular don't like computers and resent being forced to use them to write their stories. Anyone who's good with the cursed things is clearly either a nerd or a sociopath, so it's safe to write bad things about them.

That kind of feeling may be changing slowly as the ranks of journalists are swelled by the more tech-savvy next generation, but we're not there yet. So I figure we'll be seeing negative stories about virtual worlds as the older writers start reading the initial wave of "ain't it cool" stories about these strange computer game things.

In fact, I expect to see stories like "Second Life: The Lurking Threat" far sooner than March '07.

...

One final point on "conservatives having a cow": it's not that simple. While conservatives are likely to object to some of the social values in current virtual worlds (lots of fantasy violence, some hypersexual stuff in the sandbox worlds), we've also seen liberal complaints that virtual worlds (primarily the game worlds) are insufficiently friendly to gays, and that these worlds tolerate hate speech and offensive behavior by players. So it's not just conservatives that have concerns about the content of virtual worlds.

Furthermore, conservatives are more likely to defend the economies of virtual worlds from liberals itching for something else to tax. One sign of this is the article "Dungeons, Dragons, and Taxes" by Jonathan V. Last in the Jan. 1, 2007, issue of The Weekly Standard. The article was (IMO) generally position-neutral, laying out some of the concepts and recent events behind taxing in-world economic activity. Second Life is mentioned, and both Julian and Ted are cited. For a publication that's taken seriously in conservative circles to devote some of its precious column space to the economic aspects of virtual worlds is, I think, a pretty good indicator that conservatives are beginning to recognize them as new territory (terra nova, you might say) that's worth defending in the ongoing "limited government" vs. "tax-and-spend" fight.

Interesting times.

--Bart

Posted Jan 3, 2007 3:09:40 PM | link

Andy Havens says:

@Mike, who said: "When Blizzard says they have 7M users, you know what that means in terms of both actual popularity and actual revenue."

Not exactly. you know what it means in terms of revenue, yes. But -- to be entirely and insanely hyperbolic -- 7M "users" could be either 7 million different people each paying $15/month, or one dude with 7 million paid accounts. They aren't counting "people" any more than SL is; they're counting subscriptions. Linden is counting downloads. SL is free, WoW is paid. We make two assumptions:

1. That a paid subscription is less likely to be inactive than a free download.

2. That people are more likely to have multiple free accounts than paid ones.

While we can argue about the validity of these assumptions, they are still assumptions. One actual human on WoW is just as capable of generating multiple and out-of-date "customer hits" using Blizzard's counting method as one is of generating "resident hits" using Linden's.

Let us also note that Blizzard provides very few other stats about their service (that I'm aware of). And that a WoW account comes with the ability to generate multiple alt/avies and to trash/restart new ones with no penalty. So that while you may have more faith in the "raw" numbers of accounts at WoW, the value of a single "player" in SL is much more aligned to a "socially unique person." In short: it is much harder, in SL, to run multiple toons (and, per my earlier comment, it's against some level of the TOS, to a degree).

Posted Jan 3, 2007 6:07:17 PM | link

csven says:

"7M "users" could be either 7 million different people each paying $15/month, or one dude with 7 million paid accounts."

Or 14 million gold pharmers; 2/account pulling 12-hour shifts. Blizzard could be under-reporting!

Posted Jan 3, 2007 7:00:14 PM | link

randolfe_ says:

Taxation is nothing special in virtual-worlds. The only complication is jurisdictional questions, which are being resolved pursuant to other, much larger scale issues.

Assets are not by and large taxed in the US or most other tax regimes. Only income and gains are taxed. Whether an asset is tangible or not is not very interesting; at least not in the tax world (it is more complicated in the financial accounting realm).

My guess is that we won't see market value taxation of purely in-world virtual gains or income for a while. We will see a dramatic crack down on anyone realizing tangible currency or services-in-trade (or any other barter) as a product of virtual-world activity. Some will cry that it isn't fair because the IRS will not readily allow the other side of the P&L vis-a-vis expenses. That is, if you produce goods entirely within SL and cash out your profits you'll be liable for taxes on that income without being able to claim any offsetting cost of goods sold expenses.

The dollar amounts are not big enough to be interesting in all the VWs combined for the IRS to care about getting involved enough to tax in-game gains and in-game barter transactions. They'll just get you going out.

Instead, there's a treasure trove of old-fashioned tax cheats (put a $ in your bank account and not on your 1040) and illegal gambling revenues just waiting for IRS and Justice and various state enforcers to sink their teeth into.

Posted Jan 3, 2007 7:35:52 PM | link

Andy Havens says:

@csven:

Or 14 million gold pharmers; 2/account pulling 12-hour shifts. Blizzard could be under-reporting!

You made me spit milk. Sweeeet.

Posted Jan 3, 2007 7:49:50 PM | link

magicback (Frank) says:

csven said:

"Or 14 million gold pharmers; 2/account pulling 12-hour shifts. Blizzard could be under-reporting!"

Hey, it's more like 21 million gold pharmers. To maximize output like any factory, they would have three shifts you know.

Whatever the case, the numbers game is a textbook financial shenanigan. Many people played the Earnings Announcement game long enough to do better at more obscure numbers.

As for backlash, there won't be any backlash; it's going to be business as usual. Just like game reviews, there's just going to be another shiny around the bend.

And someone in the PR biz reading this thread should reveal to all the inner workings of the relationship between PR and Media.

Frank

Posted Jan 3, 2007 9:51:38 PM | link

Andy Havens says:

@Frank: I'm in the PR biz.

If I told ya, I'd have to kill me.

Posted Jan 3, 2007 11:03:31 PM | link

Raph says:

@Mike, who said: "When Blizzard says they have 7M users, you know what that means in terms of both actual popularity and actual revenue."

Not exactly. you know what it means in terms of revenue, yes.

No, you don't. :) The 7 million are under a wide variety of payment plans and prices in different territories. Most notably, if 3m of them are in China, they don't earn anywhere near $15 a month in revenue for Blizzard.

Posted Jan 3, 2007 11:04:24 PM | link

Clay Shirky says:

Bunches of SL obfuscation about how hard it is to report any real numbers, now up at C|Net. (http://news.com.com/Counting+the+real+Second+Life+population/2100-1043_3-6146943.html?tag=st.prev)

My favorite quote, from Cory:

"I'm open to any Internet service that has a solution to the Internet identity problem," said Ondrejka. "We don't know who's at the other end of the keyboard."

When he realizes he controls the server and the client, and he learns about MAC addresses, he's gonna be so happy. Wonder why no one has mentioned that to him so far...

Posted Jan 3, 2007 11:12:32 PM | link

Mike Sellers says:

It's true that the number of Asian (especially Chinese) users, and distribution agreements in Asia, muddy the revenue picture for WoW, but only to an extent: based on public statements, the game will do about a billion dollars in revenue in 2006 -- after licensing fees. So by whatever measure, that's off the charts in terms of the MMO industry. And a far cry from 40,000 subscribers or 100,000 occasionally paying users.

Clay, the #1 rule (it'd be #0 if we wanted to be real geeks) in MMOs is that you never ever trust the client. Ever. Not even with MAC addresses. You control the server, but the client is in enemy hands. Until we have much better levels of identity verification, if we ever do (even better than banks use currently online), we really won't know who's on the other end at the keyboard.

Posted Jan 3, 2007 11:50:48 PM | link

Stan Trevena says:

Great thread running here. A few things......

30 avatars on WOW, three for me on one account, all the rest shared by my three sons (they have tried virtually every race/speciality combo available) on their account.

Paid WOW accounts do not equal individuals. Most of my networking staff have anywhere from two to five separate accounts. Many use their "other accounts" as mules, auction house slaves, and bankers for guilds. True they are paid, but they are not "individuals" or "residents". That was my point to Shirky. That 7 million number in WOW is paid accounts, not individuals. His latest posts have been in setting a definition of a "resident" and I was contrasting that with other MMO's. Is it ok to use different measures to quantify differnet MMO's?

I was also making a statement about the many grinding accounts owned by gold farming houses in Asia. These accounts are not accounts owned by individuals, but rather run around the clock by many users to profit from in-game gold and items at a slave wage.

If we are going to nit pick on people checking their facts, Clay needs to dig into Internet identification methods. Spoofing a MAC address is the oldest game in the book. How do you think we all got our home routers to run on broadband in the early days? Spoof the registered MAC from the "official" install (read: your PC's MAC) to the outside port on the router, NAT all the addresses on the private side.

As far as IP addresses, there are plenty of services out there to mask your IP address. Hide = Proxy.

Posted Jan 4, 2007 1:41:18 AM | link

Mike Rozak says:

The point about Mac address is that, unless a skilled player specifically tries to obscure the mac address, then it's a reasonable way of judging when a unique player (or at least a unique computer) connects. And if mac addresses don't work, a random ID can be generated and stored in the registry for each unique install. This too is overridable, but I'd guess that 99.9% of SL users wouldn't be able to or wouldn't bother since they have nothing to gain from doing so.

Which means there is a way of telling how many user-computer combinations connect every month.

However, I don't see the point in pin-point user-number accuracy. A ballpark figure is reasonable.

Posted Jan 4, 2007 1:53:22 AM | link

Ren Reynolds says:

Fascinating responses.

I agree with a lot of what people are saying. The fact that the content is user generated thus it’s not so easy to blame some ‘other’, for instance is a great point. However I just feel that much of the media is way more superficial than that. To me the story of SL has a life of its own, as I said I think it relates little to the actual merits or otherwise of SL and LL. I’ve met people who talk about SL who think that LL does create a lot of the stuff there, as: that’s the way these virtual worlds work – right.

Plus I never stop to marvel at the way the press can create an ‘other’ to demonize, the classic is child abuse where we know it tends to be caused by family or people in the immediate circle – which is a difficult story to deal with as then notion of ‘family’ gets disrupted so it’s all ‘stranger danger’ and as I’ve said before this is a case where I thin the press do genuine harm.

@ Andy Havens
New mousetrap is not a backlash in and of itself, but it can be used to motivate one – ‘this is great’ with a dose of ‘omg that is rubbish’.
A money laundering story does not need actual money laundering, just some misguided notion that it could be happening right now.

@Jess
Why now if it has not been covered for the last 20 years? Coz it’s not been on the cover of Business Week for the last 20 years

I really hope for your analysis of stories maturing over time, that would be great.

@Proc
BDSM Suicide / Murder – unfortunately that’s a good call. If only coz of the numbers – as it gets bigger someone somewhere will kill or be killed and they will have used SL once and that will be enough to get the press going. Also I don’t discount that there may be something that really is motivated through and SL mediated relationship, and while the people involved might also talk over the phone, we won’t be blaming that tech.

@Clay
Marketers revolt – as a some time marketer myself I do wonder about that one, things seem a little too incestuous for that, I’m not sure what anyone would have to gain through doing it, ok it could come from frustration. It could happen but I dunno.

Posted Jan 4, 2007 4:14:21 AM | link

csven says:

@Stan - Thanks for confirming you don't have 29+ sons.

Posted Jan 4, 2007 10:51:36 AM | link

Stan Trevena says:

@csven

God no, trust me, triplets were shock enough! They are 14 years old now, so they've been fun companions for a number of years now in other MMO's. We have several computers here at home so several can play together.

They are all involved in the education project in SL that I coordinating (http://pacificrimx.wordpress.com). We had a professor from a local university over yesterday to see what the project was all about. He sent a very nice email afterwards. He said it was really amazing to watch the interaction between my three boys (and other student) and the teachers involved in the project (from Japan and here in the US). The interactions and communications between Japan and my school district at this early stage have already gone far beyond what I was expecting. And almost all of these people are not gamers, they are new to this whole VW concept.

And that is why I contribute to all of these discussions, and why I try to point out that there are "non-game" (in the traditional MMO sense) educational uses for a platform like SL (or any other open ended VW). Educators can potentially bring in hundreds of new "residents" each with their projects. Imagine if that market is tapped to any degree in the future.

Posted Jan 5, 2007 2:13:23 AM | link

Andy Havens says:

Well... It's February 2... One month closer to March 2007...

Second Life now reports 3 million residents. Whatever that means. And Google News, as of the moment, reports 177 stories on the search "Second Life" + "millions" from the last 30 days.

The count-down to the backlash continues...

Posted Feb 2, 2007 4:08:55 PM | link

Andy Havens says:

And on into March! One month closer to... March. Or, well... the end of March.

SL with 4.3 million thingies! Residents! Meaningless number! But, by god! It's MORE! Google News reporting 87 stories from the last 30 days with "Second Life" + "millions."

Some other Google News combos...

SL+sex=86
SL+prostitution=5
SL+money laundering=3
SL+terrorist=13
SL+addiction=7
SL+gambling=8
SL+brands=83
SL+job=151
SL+education=78
SL+scam=3
SL+rape=10
SL+world of warcraft=317

(I find it amusing that there are 3X as many stories with SL and WoW than those that mention SL and the word "millions." So... stories that mention SL are still using other products in the category to anchor it. Hmmmm....)

SL+Linden=900

That last was to get a general idea of straight-up stories. We've got press stories from Information Week (Inside Second Life's Data Centers), cNet (In 'Second Life,' the ring of revolution?), Baltimore Sun (Second Life gamers invent another self), ZDNet (Linden sees academic potential for Second Life with 3D voice), Totally Jewish (Virtual Shoah museum opens), CNN Money (Second Life's looming tax threat), a whole mess of stories about the John Edward's thang, a mess of stories about voice in SL, MSNBC (Starting a Second Life business)... the list goes on.

There are some stories with negative slants, yes -- SECOND LIFE: VIRTUAL LOSES ITS VIRTUES, Dutch demand ban of virtual child porn in Second Life, The phoney economics of Second Life -- but, by and large, they are either positive or a bit of both.

Still waiting for the... uh... first shoe to drop.

Posted Mar 5, 2007 5:42:03 PM | link

Andy Havens says:

And it's April! Welcome to Spring (in the Northern Hemisphere, anyway), the NCAA finals (Go Bucks!
Beat the Gators! ... my contractual obligation is complete), and...

The end of March.

No backlash. Nothing major that I've heard of. No wailing and gnashing of teeth, other than from the sayers-of-nay who have been saying nay from way way back in the day.

SL with 5.2 million meaningless jelly-beans in the big, virtual glass jar. 739 stories in the last 30 days via Google News on "Second Life" + "Linden."

And we've got some interesting stories out there, people. And not just about flying penii, virtual strip joints, furry erotica, S&M, pyramid schemes, the loopiness of it all, etc.

Scroll down the list on the SL home page of recent press and look for the "backlash" from MIT's Technology Review, University Business, Law.com, US News, CNet, etc. etc. There's some funky ducks in the water, folks.

I'm not a fanboi, and I'm not a booster. I just haven't, yet, been presented with the compelling reason why SL *isn't* interesting. And I didn't think, back in December, that there would be a backlash.

Seems the big-wide currently agrees with me. Maybe it's just taking longer to get all frothy. But at the moment, SL ain't slowing down.

Posted Apr 1, 2007 11:38:11 PM | link

randolfe_ says:

Maybe US media is just slower or less critical. I won't go so far as to say most of the US MSM is little more than one big paid infomercial. But following the German media I'd say the backlash is well into it's third month. Many of the major publications have turned critical, not only on Second Life but even more so on the irresponsible media hype coverage of Second Life. It's getting rough for those still singing from the SL talking points sheet. Just ask Der Spiegel.

Posted Apr 2, 2007 11:57:35 AM | link

Andy Havens says:

@randolfe: I'm confused. I thought we were talking about the theory that the MSM, largely in the US, had gotten the SL story (and the numbers, in particular) all wrong, thus feeding into the numbers game in an ongoing cycle of "bad press feeds bad marketing feeds ill-informed users feeds more bad numbers feeds more bad press."

Therefore, the backlash was supposed to be about, "My god! We've been duped! There's no million(s) of users! It's a just a few dozen sex fiends / terrorists / ponzi schemers trying to sell us virtual snake oil! Lynch the toons!" Again, said stories to roll out in the US MSM that had originally so badly fallen for the tasty morsels of cheesy, yet inflated SL tawdry goodness.

There are still some "What's going on here?" stories, yes, and some, "This can't all be good," ones. And some ones that question the need for this kind of space at all and some ones that ask good, pointed questions about legal and moral issues. You know... actual, well-rounded coverage of a legit news topic.

I wouldn't call a "fair number" of stories that have questions about SL or that take issue with its service a "backlash," though. Look at Ren's initial def:

"And by backlash I don’t mean a few people saying SL is a bit rubbish, a lot of people say that already. I mean something like: more than one NYT piece that directly references SL stories saying that either claims are just not true; or that it’s old news and there is a much better mouse-trap; or that there is something horribly negative about it that everyone’s been missing."

Go to Google News. In the last 30 days there were 2,118 hits on "Second Life." When you get a "backlash" against something in the MSM, you'll see a trend toward real (and usually specific) negativity. It's not there.

As for Der Spiegel... I don't read German, so I had to make due with the international version. Their March 2nd article on SL is... well... an article. It mentions the FNJ fracas, the Marc Bragg lawsuit and the whole "sex between adults and minor avatars" angle. All of which have been old news in the US MSM for months. It mentions Nick Yee's research on avatar spacing and gender roles. Go Nick!

It also quoted the then "non-number" of 4 million, and went on to quote French SL blogging expert Loic Le Mer, who, "...predicts that more and more people from all over the world will earn a living through Second Life in the future. 'The great thing about Second Life is that it brings together people from all countries, and everybody can make money by creating an object and selling it,' he says, adding that an acquaintance of his makes €1,000 a month from selling virtual glasses to avatars."

That last bit sounds more like feeding the original fluff tornado at times. In all, though, it was just what we've been getting in many of the major US rags for the last 3-6 months: balanced reporting on a "weird phenomenon." Something takes off, these crazy kids really seem to dig it, and so the press writes stories.

Go figure. If you've got more backlash somewhere that qualifies as such, please share. If it's just an article that isn't entirely glowing, though... doesn't count. Those have been around all along.

Posted Apr 2, 2007 3:21:34 PM | link

randolfe_ says:

I'll defer to your apparent official score keeping. Thanks for clarifying what is what for me. I'm kinda slow.

The reference to der Spiegel is in regards to the public defense and subsequent apology from the editor of those stories as a result of the blogger backlash against the publication's lack of journalistic integrity.

http://www.taz.de/pt/2007/03/30/a0209.1/text (die tageszeitung)

In February Handelsblatt (like the WSJ in the US) ran a widely reprinted critical article, including in der Tagesspiegel. The original ran in BusinessNews 21. Februar 2007. I have the PDFs but no rights to redistribute or I'd post them for you. (Author was Sven Scheffler).

Die Welt, one of the major national papers, had a very critical article just a couple days ago.

I don't want to do all your homework for you, though. That should be enough to get you pointed in the right direction so you can go turn around all those wayward Deutsche. Not implying that you're not a booster, though.

Oh, and as for anyone "making a living" ... and how everyone seems to "know someone" who's doing it: I'll contain my incredulity as best I can. Here, from Linden's own published numbers,

Exactly 116 people earn a maximum average positive USD net profit (net of minimum fees and expenses and the lowest bar opportunity costs) of $17,281 per month. Not bad!

But the next 211 people earn a maximum average of only $1,578 per month.

And the next 283 LOSE $282 on average. And on down the chain of all 25,366 who are apparently at least trying to net some "PMLF", a cute way to say redeemed L$ for dollars in excess of L$ bought.

So of those 327 people making positive $ or €, apparently I've heard testimonials from every one nearly twice in the past 60 days, judging from my hate mail, obscene blog comments, and outright threats.

Of course, if I was one of those 100 (out of what, 5.1 million now?) sitting on $15-$20K/month I'd do my best to keep the dream alive too. I could draw some convincing graphs...

Posted Apr 2, 2007 6:51:26 PM | link

Andy Havens says:

@randolfe: My... We are snarky today, aren't we?

Well, the article did not contain links to subsequent issues or apologies, and I did look on the English language, international version of the site and didn't find, in an half-hour or so of perusal (no... not a PhD's worth of work, but more time than I spent on any individual US pub) any other articles on SL from the last couple months. Couple points:

I didn't say I was the official scorekeeper. Just clarifying what the original intent of the issue was. To examine the -- supposedly -- over-the-top, incredibly out-of-control, press-gone-wild article fury that Clay and others were pointing at... and to predict an eventual, and soonish, backlash against such. I made the case at the time that the SL press furor, while, indeed, often guilty of the same crap it's always guilty of, didn't qualify as a "lash," and so there wouldn't really be a backlash. We're too close to in on this blog. The whole, "Ooh... The big number is wrong," thing just isn't a story. The, "Hey! When they say that you can make money, it means only a FEW people can, and it's probably a huge pain in the ass to do so," story isn't much of a story, either. That's all I was saying then, and all I'm saying now. The press coverage of SL has been based, all along, on a whole lot more than spurious numbers and breathless, "My god! It's full of bars... Titty bars!"

So now... a couple stories aren't favorable. Yes. That was true then, too. And it's true now. SL attracts strong feelings on both sides. I am not, as I have said numerous times, particularly a booster. There are things wrong with SL. There may be some things seriously wrong with it. I've just not had them pointed out to me in any less irrational a manner than most people point out the things that are good. People get all wiggy on both sides. I try to maintain something approaching... what's the word? Ah yes.

Logic.

Also... In my comments in the past -- on your own issues r.e. economics -- I've said as much about the fact that so few people are making money. I agree with you. And it's one of the reasons I believe that; A) SL can't be a ponzi/pyramid/whatever scheme, and, B) that using real-life economic tools to measure what's going on inside SL is illogical. Too little of what's happening there is due to economic reasons. Again... as you point out. When such a small percentage of people are making ANY money, and many people are losing money... the rest of them must be doing what they're doing for another reason entirely. I don't know... maybe it's fun? Maybe creating stuff and chatting and dancing and hanging out and playing is a reward in and of itself? Maybe it's kinda like a game? And, for many people, it's free or nearly so? Go figure...

My point about the "making money" quote in the der Spiegel piece was that it was an example of how the coverage wasn't all negative in that pub.

So, again... my homework is done. I waited 3 months to see if the press would turn on SL. It didn't. End of story. If somebody else wants to predict that it will happen in, oh... another 3 months? Somebody else can watch that ticker. I was just trying to provide a public service. ;-)

Posted Apr 3, 2007 11:59:34 PM | link

randolfe_ says:

Andy

Your public service and my snarkiness (snarkedness?) is noted. Perhaps I'm still trying to get my arms around your illuminating me that all economics are zero-sum because of the laws of thermodynamics thing. We do agree on a number of things, as much as it may annoy either of us. I'll leave you to deliver the message to Herr Castronova that Second Life cannot or should not be analyzed with economic tools. Aside from the fact it is apparently also impervious to financial or statistical analytical techniques, I'm a bit slow on the uptake as to exactly why then Linden Lab prominently posts a big "Economics Statistics" section on the SL web site. Perhaps we mean "no no no, not those kinds of economic tools, just the one's that anyone else tries to use".

Posted Apr 4, 2007 12:17:09 AM | link

Andy Havens says:

randolfe: We do agree on much. Peace between us, then.

My comment about thermodynamics was meant as hyperbolic irony. Doesn't come through the text sometimes...

And I will ammend my comment about "not using economic tools." You make an excellent point. We use economic tools all the time to analyze all kinds of data, services, businesses, entities, etc. that are not "economies." We can certainly use economic tools to analyze SL as a business. We can use them to analyze it as a product/service. To compare it to other similar entities and to evaluate its value as entertainment, etc. If it were a public company, we could use economic tools to evaluate its worth as an investment. The same as we do other entertainment, gaming, content, etc. companies.

What I've been trying to get at, though, is that SL isn't "an economy," or enough like a full-blown, national, state-sponsored (don't know the term; again, not an economist) economy to be evaluated as such using economic tools. It would be like (bad metaphor alert) using medical tests to evaluate the quality of a doll or a manikin.

Many of the same tests used on humans during a physical exam might, in fact, be applied to a doll or manikin, eh? We can ask, "How much does it weigh? How tall is it? What is its skin tone?" But these facts, though identical in how we measure them to those of a human, are, essentially, meaningless because of the context. A doll is not a living person, and the reason we use medical tests on humans is to evaluate their health (ie, how "not dead" are they).

I feel the same way about SL. Its economic componets aren't sufficiently central to its main functions to render it an "economy." So while economic measurements can render certain valid judgements about aspects of its play, business, value, etc., they can't be used to analyze it as "an economy" in comparison to other entities that are more fully "economic" in nature. To torture the recent metaphor more fully, it would be like claiming SL is an "unhealthy person" because it is a very lifelike manikin without a pulse.

If you want to use economic tools to measure the flow of currency within the game in kind of a distant, microcosmic manner and make the observation that "more money changes hands in SL than in the country of XYZ," because that's kind of interesting/entertaining... that's cool. But it's not the same as saying, "You can do all the economic things in SL that you can do in country XYZ, and more." Again... it's like saying, "This doll has a more healthy height-to-weight ratio than this really, really skinny person." OK. Said skinny person is way thin, even compared to a doll. It doesn't make the observation one about overall health, but just, possibly, interesting.

I agree with you about the hype r.e. making money in SL. It doesn't happen to a degree that allows for it to be considered a "function" of the platform. It's a feature. And a minor one at that, imho. The creativity and connectivity aspects are much more interesting and important, I think. But because it is a feature, Linden spanks it. And hard. Why? Beause the press loves it. People buy cars because they have good cup-holders. Is that smart? I don't know. But they do. There may be some huge number of SL players who get in because the minor, unimportant, over-hyped, under-good economic features were attractive to them. And then they stay because they like the other stuff. Or they leave because they don't. That's how it goes with advertising/marketing. Linden takes that chance when they put so much "oomph" behind a feature that so few people use to great advantage.

But it doesn't make it fake. It just makes it less important.

Posted Apr 4, 2007 2:42:58 PM | link